The validity of the argument raised by the New York Yankees.
Explanation of Solution
The revenue-sharing model for Major League Baseball (MLB) teams was given by the blue-ribbon panel, which was an autonomous board selected by the MLB commissioner to look into the matter of increasing inequality between the local returns. The mechanism tends to favor the local revenues. The mechanism that tends to favor the revenue sharing redistributes the income between rich and poor teams. The balance is preserved for the future. Thus, it is assumed that the coming demand for sports will upsurge, leading to an increase in revenue of the game. Some big clubs claimed that some teams should not get the money. They said that certain teams have not shown any upgrading after the revenue-sharing model and in its place some team owners hoarded the profit. Therefore, it can be said that the revenue allocation does not increase the balance in the competition but it reduces the incentives for teams to win.
Want to see more full solutions like this?
- What do you believe will be the outcome of this game if it is played once? Is there incentive for the players to collude?arrow_forwardIn bargaining scenarios without player impatience, explain how the number of bargaining rounds and who makes the first offer affect the final outcome.arrow_forwardWhat market structures are the NFL and Google?arrow_forward
- What is the commonly owned resource that gets depleted in the Fish Banks game? Why is the resource depleted? How might the teams have prevented the tragedy from occurring?arrow_forwardThe Gulf Cartel and Sinaloa Cartel are the two major cartels in illegal drug trade in Mexico. Although, each of these cartels are better off sharing the market, they have an incentive to try to take the entire market. In which of the following ways is cheating among these cartel members dealt with in this region?arrow_forwardDistinguish between different types of financing available to sport organizationsarrow_forward
- Should free agency change the allocation of players across team? Will this effect competitive balance?arrow_forwardIn North America, although sport teams have monopoly power, but they do not profit maximize. Outline reasons why they do not profit maximize on their ticket sales. Provide 5 bullet points.arrow_forwardIf the league was ruled a single-entity which of the following would be true? The league would be subject to antitrust laws The league would be a oligopoly The league would be exempt from antitrust laws None of the above The reserve clause: Allowed the Federal League to monopolize the pool of talent. Allowed NL and AL to monopolize the pool of talent. Required the players to join a playerâ s union. Gave players a trade clause after a reserve period Define market power? When the market is faced with multiple firms When a firm has an L-Shape MR curve. When the market is considered competitive When a firm can influence prices and output Please sir answer both sir I have no more question sir please please request sirarrow_forward
- How do "Nash equilibrium" and the idea of one "player" impacting another "player" within an organization affect the economic decisions and growth of an organization?arrow_forwardPresent an example of a prisoner’s dilemma in your own life. Describe the “cooperative” action for each player that involves trusting the other in some sense. Explain why mutual cooperation will lead to an outcome that is preferred to mutual defection. Describe why there is an incentive for each to defect, or not cooperate, or not be trustworthy. Discuss what might be done to promote mutual cooperation, or what is done.arrow_forwardwhat will happen to the supply of the Blu-rays players if a new breakthrough in manufacturing technology reduces the cost of producing Blu-rays by half?arrow_forward
- Exploring EconomicsEconomicsISBN:9781544336329Author:Robert L. SextonPublisher:SAGE Publications, IncManagerial Economics: Applications, Strategies an...EconomicsISBN:9781305506381Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. HarrisPublisher:Cengage Learning
- Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning